Charlie McConalogue (Donegal North East, Fianna Fail) | Oireachtas source

I welcome the opportunity to contribute to the debate on the Finance Bill. I am opposed to it and the approach taken by the Government in the recent budget. That budget represents little more than an attempt to buy votes with borrowed money. It is the fourth regressive budget introduced by the Government. On this occasion, the current Administration has chosen to provide tax cuts but these will be funded by more debt and are skewed towards higher earners. As a result of the provisions contained in the budget, the benefit reaped by an employee on €70,000 will be four times greater than that which will be garnered by a person on the minimum wage. When the Government previously increased taxes, it raised money from people on a flat-rate basis and regardless of their incomes. The abolition of the PRSI allowance resulted in €264 being taken from everyone in the country, regardless of how much they earn or how well off or poor they might be. The 2% increase in VAT was another regressive measure which took money out of the pockets of the least well offer on a disproportionate basis. This Government also introduced cuts in respect of the respite care grant, education and health services. As a result of the cuts to health services, people's medical cards were withdrawn and others were obliged to spend more time on hospital waiting lists before they could get to see consultants or have medical procedures performed.

Another regressive measure introduced by the Government was that whereby the ESB was obliged to make payments of tens of millions of euro each year. That company passed the cost in this regard on to its customers, leading to higher energy bills. The poorest and most hard-pressed families in the country found it extremely difficult to pay those bills. Again, the most was taken from those who could least afford it. When the economy was on the way down and when money was being taken out of it, the charges and cuts that were introduced were focused on the less well off. As growth returns and the economy rebounds - there is not much evidence of this in many parts of the country as yet - the Government is beginning to spend again. However, instead of returning what it took from the less well off, it is giving money to those who are better off. In its recent budget, for example, it decided that the best way to proceed was by reducing the higher rate of income tax rather than focusing on services. As a result, a couple with a single income of €41,000 will be better off by approximately €174 per year whereas, as a result of the budget and the Government's approach to taxation, a single person who earns €70,000 will be better off to the tune of €746 per year.

The Government has decided to go down the road of giving money to the better off and is seeking to pay for this by introducing even more flat charges, including that relating to Irish Water. The latter, which is another regressive charge, will be the same for every family, regardless of income. The Government is again seeking to take money off families regardless of their ability to pay while simultaneously allocating funds in a way which it believes will win votes for it at the next general election. It is time the Government changed its approach and realised that charging people for water is just not on. Families in which there are four adults will, regardless of their income, be obliged to pay up to €500 for water each year. The Government must revise its approach. It must suspend the system of water charges rather than continuing with the current farcical situation which has given rise to great concern among people throughout the country who simply do not have the money to pay the bills the Government expects them to pay. Unfortunately, this Administration does not give any consideration to people's ability to pay when it introduces new charges. That was made obvious by the fact that it did not put in place any structures to provide assistance to those who might find trying to pay those charges more than they could bear.

My party has regularly challenged the Government on the floor of this House to indicate how it expects those who simply cannot afford to pay to meet the bills with which they will be presented. It never provided an answer in this regard. It scrambled about, returned to the Dáil and indicated that those in receipt of the household benefits package would receive a payment of €100. A week later, as more pressure was exerted in respect of those who are unemployed or on low incomes, the Government decided that a €100 payment would be introduced in respect of those in receipt of fuel allowance. On budget day, it decided to bring forward a tax rebate of up to €100 for people obliged to pay up to €500 in water charges. The Government gave so little thought to this issue that it forgot to make provision for those people who find themselves beneath the threshold and who are not in receipt of either the household benefits package or the fuel allowance. It is obvious that this Administration did not give any consideration whatsoever either to how people were going to pay or whether they could afford to pay. Under the charging regime that was originally introduced, a household in which two adults live would be expected to pay €278 per year, one with three adults would have to pay €381, for a household with four adults the charge would be €483 and - regardless of income - a household with five adults would be obliged to pay €586. This is money which the vast majority of people simply do not have at present. It is obvious that the Government was blind to that fact and that it intended to proceed with its regressive approach to budgetary and financial matters of imposing flat charges on people, regardless of either their incomes or ability to pay.

The recent budget clearly illustrates that the Government is looking towards the next general election. It is obvious that its members asked what they might do in order to put out a good PR story and give themselves the best possible chance of winning votes in that election. In the meantime, families were left wondering how they were going to pay their water charges. In addition, people's medical cards continue to be withdrawn, others continue to wait to see hospital consultants, waiting lists for hospital procedures continue to grow and schools throughout the country continue to be starved of funding. With regard to the latter, the Government made no provision in the budget in respect of the summer work scheme or the minor works grant in order to assist schools in the year ahead. Instead, the boards of management of schools will be obliged to go back to families and ask them to stump up the cash required.

The Government should listen to the people, suspend water charges and review the entire set-up.

A decision was taken by the Government to establish Irish Water without debate or consultation with anyone in this House or outside it. My colleagues and I on the Opposition side were compelled to walk out of the Dáil before Christmas as the legislation was run through the House. Only after many Government refusals to answer questions did we learn how much it is spending in establishing Irish Water.

Initially the former Minister, Mr. Phil Hogan, now safely ensconced as an European Commissioner in Brussels, told us the cost of Irish Water would be €10 million. Only later on a radio programme did we learn from the chief executive of Irish Water, Mr. John Tierney, that the cost of consultants for the project will reach €175 million by the end of next year. Very little has been heard of the chief executive since and the €10 million cost suggested by the former Minister is incorrect. Not one euro of the €175 million cost of consultants' fees will improve pipes or water quality.

The Government has decided to proceed with a metering programme that will cost up to €500 million. Again, none of this money will go towards improving pipework or water quality for households that suffer poor water quality day in and day out. All in all, in establishing Irish Water the Government will spend more than €650 million in a manner that contributes nothing to water quality and network improvement. Meanwhile, the Government asked people who are provided with bad water to pay full water charges and only reconsidered this when it was dragged over the coals. It is time the Minister of State reconsidered the whole operation.

It is incomprehensible that the Government expects people to sign up to be charged for water when at this point they do not know what they are signing up for, what the charges will be or what the structure will be. Day after day the public is being treated to a different story on this from a different member of the Government. Yesterday the Tánaiste and Minister for Social Protection, Deputy Joan Burton, gave her view and we later learned this was only her personal view rather than that of the Government. Other people denied the figures raised by the Tánaiste and claimed they are still under consideration. Meanwhile, the Government expects people who do not know how they will pay water charges or what will be the level of those charges to sign up, return forms and agree to its approach.

It is time to draw a line under this matter. The Government should spend the money that has been allocated for Irish Water on improving the water network. In future, people's ability to pay and financial circumstances should be the determining factors when the Government is budgeting for the measures it is to introduce. The confusion surrounding this issue has added to difficulties. Those currently being charged for water, including businesses and farms, are unsure as to how they will engage with Irish Water. Many small businesses and small farms with domestic allowances have made water payments to local authorities for some years. After the establishment of Irish Water representatives of such enterprises wondered how they would engage with the new body and asked who they should pay and how much. They were told that the answers are not known but will be sorted out as things go along. Donegal County Council charges businesses and farms €1.50 per cubic metre of water but Irish Water will charge households €2.44 per cubic metre. There is no clarity as to how this makes sense and the people to whom I referred are being told they will have two bills - one from the county council at the lower rate and one from Irish Water at the higher rate.

Group water schemes were also left in the dark as the Government pursued a hidden agenda that people do not understand. Representatives of group water schemes asked how such entities would be billed, if at all, and were not given answers, apart from "we do not know". Some people say they should sign up as a group water scheme that is availing of public water and therefore pay charges. However, Irish Water's online system allows users tick only one such category and this means they do not have to pay at all. Those in group water schemes do not know how they stand and there are more than 600 such schemes in Donegal. Some people in group water schemes are one day told that metering will occur at the entry point to the scheme and another day that they will not have to pay at all. Other days they are told they will be metered and will have to pay if using water from the local authority. This is an unacceptable way to treat people who worked hard with neighbours and other members of the community to lay the water pipes that serve them. It is indicative of the lack of thought that went into the establishment of Irish Water and deciding the charges involved. There is no clarity as to whether Irish Water will take over group water schemes - we cannot get an answer.

A similar situation applies to housing estates. Previously, if management of an estate was to be assumed by a county council the county council in question made decisions as to responsibility for roads, lighting, water and sewerage. Now the water and sewerage elements of such estate must be sanctioned by Irish Water. Irish Water representatives recently briefed councillors in the north-western counties and indicated it will not take responsibility for housing estates that are not connected to public sewerage - that is, any estate with its own treatment scheme. This means that hundreds of estates in Donegal, and many more in other counties, will not be taken over by local authorities, as their residents had hoped. Irish Water has washed its hands of such matters and does not want to deal with people who are not connected to the public sewerage system. This is yet another example of how poorly planned this matter has been. Irish Water will be more focused on collecting revenue than maintaining the level of service that existed previously via local authorities.

The former Minister of State, Deputy Fergus O'Dowd, was involved in establishing Irish Water and he has said that this body is a sham that is not fit for purpose. Meanwhile, those who tasked the Deputy with establishing Irish Water continue to stand by the body that he was instrumental in setting up. There must be a complete change of approach and the public must get some certainty. Water charges should be suspended and there must be a review of how to approach the matter. The national water system must be audited. Instead of spending funds on consultants to set up Irish Water and installing water meters the Government must listen to the people.

Instead of setting up an entity complete with bonuses, the Government should listen to what they have to say. The Government should change its approach and not put charges on people without any regard to whether they can afford it. The Government should focus on ensuring that investment is put into our water services and that people are respected and given the service they need. Money must be put into ensuring they have a consistent water supply. Furthermore, any decision taken about how this is to be funded should have at its core the principle of ensuring that nothing is asked of people without giving foremost consideration to their ability to pay, something we have not seen from the Government in respect of Irish Water and, unfortunately, something we have not seen from the Government in any of its four budgets. For these reasons I will be opposing the Finance Bill. I urge the Minister of State and the Government to take on board what is being said by the many people on this side of the House and to change their approach.

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